Taxation is a critical issue in Ireland's current economic climate following six years of recession and austerity. It is one of the most topical concerns of its citizens and receives almost daily media discussion and analysis. .
This essay will aim to examine the Irish Taxation system, however as there are a vast array of elements regarding tax, it is difficult to identify Ireland's system under one of the categories of over taxed, under taxed or badly taxed. Indeed, the title suggests that Ireland has not managed to get taxation quite right! When we examine the aspects of the Irish approach to taxation, there are clear examples of all three of these categories. However, over-taxed and badly taxed seems to be the most prevalent. This essay will assess all three of these elements individually and illustrate how they are all present in the current Irish system. It will put into perspective the levels of taxes the actors in the Irish system pay. It will discuss the impact that over-taxation, under-taxation and bad taxation can have on the relevant actors; the general public, employees, employers, corporations and the government. Lastly, it will discuss how taxation in Ireland has changed from the 'celtic tiger' era to now. .
If we examine Ireland as being over taxed, we must first identify the range of taxes that are levied, both general income tax and 'hidden' taxation. In recent years, this range of taxation has increased to include the following: income tax, VAT on purchases (which has been steadily growing as a result of increases in successive budgets) household charges, property tax, bin charges and most recently the controversial water charges. In the current Irish income tax system, while the people in the low earners category pay less than the OECD average, the average wage and high earners pay a relatively higher percentage of tax than the OECD average. The middle and high earners have experienced the highest burden of increased taxes since the collapse of the celtic tiger, some people argue that these taxes have gone too far and are restraining the recovery of the domestic economy.